Today, the European Commission and the European Investment Bank (EIB) are announcing a new partnership to support investments in the EU’s battery manufacturing sector. This partnership will see a €200 million top-up (loan guarantee) to the InvestEU programme from the EU Innovation Fund. It comes in addition to €1 billion in grants to support electric vehicle battery cell manufacturing projects via the Innovation Fund, also announced today. As part of the new partnership, the EIB envisages investing a further €1.8 billion in the wider battery value chain. These joint efforts will result in €3 billion of public support in total for the development of a competitive and sustainable European battery industry.
The €200 million InvestEU guarantee top-up by the Innovation Fund will be directed to support innovative projects along the European battery manufacturing value chain to address financing challenges by enabling additional EIB venture debt operations over the next three years. In particular, the venture debt operations will:

help companies to bridge the gap between the research and development phase and large-scale commercial deployment;
reduce market failures;
leverage public funding to mobilise private investment;
contribute to the establishment of innovative and resilient supply chains for energy storage in Europe.

Support will be directed to a wide range of battery technologies, such as developing advanced materials, components manufacturing, or innovative recycling techniques. Funding prioritises technological innovations beyond basic cell or pack assembly and excludes mining and extraction activities. The EIB will conduct a periodic application process to evaluate whether an operation is eligible under the defined top-up criteria, as well as the project’s commercial and technical viability. Interested applicants can find more information on the EIB Venture debt webpage and apply through the EIB MyRequests portal.
The EIB supports the wider battery value chain, including raw materials, research, production, charging infrastructure, and recycling. Over the past six years, the Bank has provided €6 billion of financing and aims to invest a further €1.8 billion. The Innovation Fund’s €1 billion Battery call and the €200 million InvestEU guarantee top-up[  comes in response to the appeal made on 6 December 2023 by the previous Executive Vice-President Maroš Šefčovič to bolster the EU’s battery manufacturing industry by allocating up to €3 billion in support to the sector. This initiative aims to incentivise investment and make the European battery industry cleaner and more competitive.
Together, the InvestEU top-up, the EIB’s own-resource investments, and today’s launch of a new €1 billion electric vehicle (EV) battery-focused call for proposals from the Innovation Fund highlight the commitment of the European Commission to make the batteries manufacturing value chain more resilient and more competitive. The new partnership that the Commission and the EIB announced today also underscores the EU’s commitment to implement a circular economy and lower the environmental impact of batteries, an indispensable energy storage technology. Strengthening the continent’s battery value chain, manufacturing capabilities, and recycling processes will help support the objectives outlined in the EU Green Deal, the EU Batteries regulation, and the Net-Zero Industry Act.
Background
Battery production is a strategic imperative for Europe’s clean energy transition, crucial not only for the transport and power sectors but also for the EU’s broader strategic autonomy. Ramping up battery production aligns with the Net-Zero Industry Act to boost European manufacturing capacity for net-zero technologies and their key components, addressing barriers to scaling up production. The InvestEU top-up will enhance the competitiveness of the net-zero technology sector, attract investments, and improve market access for cleantech in the EU.
With an estimated total budget of €40 billion from 2020 to 2030 from EU Emissions Trading System revenues, the Innovation Fund aims to create financial incentives for companies to invest in cutting-edge low-carbon technologies and support Europe’s transition to climate neutrality. The Innovation Fund has already awarded about €7.2 billion for innovative projects through its previous calls for proposals. It has recently selected 85 new projects for grant preparation under its IF23 Call, expected to receive an additional €4.8 million.
The InvestEU programme provides the European Union with crucial long-term funding by leveraging substantial private and public funds in support of a sustainable recovery. It also helps mobilise private investments for the European Union’s policy priorities, such as the European Green Deal and the digital transition. The InvestEU programme brings together the multitude of EU financial instruments currently available to support investment in the European Union, making funding for investment projects in Europe simpler, more efficient and more flexible. The programme consists of three components: the InvestEU Fund, the InvestEU Advisory Hub and the InvestEU Portal.
 
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New accession candidates will need to undertake equally ambitious reforms to make the next expansion a comparable success
Poland is one of the success stories of European economic convergence. The country, which in January takes the reins of the Council of the European Union (the decision-making institution representing the Union’s member states) is now the EU’s sixth largest economy. This convergence process was driven by the 2004 EU enlargement, which also welcomed the Czech Republic, Cyprus, Estonia, Hungary, Latvia, Lithuania, Malta, Slovenia, and Slovakia into the Union, expanding the EU’s population by about 20 percent.
Twenty years later, as new EU accession discussions are underway, it is worth looking at how much the earlier enlargement benefitted new members and the whole Union, and reflect on the economic returns of broadening the European single market. The current accession candidates, in different stages of the process, are Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia, Serbia, Georgia, the Republic of Moldova, Ukraine and Türkiye. In October, the European Commission issued a new report with detailed assessments of the state of play and the progress toward EU accession made by each candidate.
 

A new note by the Regional Economic Outlook for Europe shows that the 2004 EU enlargement brought substantial income gains. These gains were particularly large in the new member states: after 15 years GDP per person was on average more than 30 percent higher than it would have been without EU accession.
The factors driving these gains in new members were threefold. First, the 2004 group benefitted from more comprehensive economic reforms prior to joining the EU than implemented in comparable other regions, including on trade, financial sector, and product market liberalization. Second, additional financing from foreign direct investment and EU cohesion funds helped boost the capital stock. Third, technology transfers and enhancements in educational attainment improved productivity.
While all regions in new EU countries gained, some gained more than others. Those already better integrated into value chains with the existing member states increased GDP per person nearly 10 percentage points more than those less integrated pre-accession, irrespective of geographic distance. Regions with firms that had easier access to long term financing gained close to 15 percentage point more than others.
Existing member states benefitted from EU enlargement too. By 2019, income per person was around 10 percent higher than it would have been in a scenario without enlargement. The main driver of these gains was the expansion of the EU’s single market, which allowed firms to expand production and reap efficiency gains, including through higher investment in the accession countries. While regions in Scandinavia, Germany, and Austria—already well integrated with new member states prior to accession—gained the most, many regions further away benefitted too.
What does this mean for next wave of EU accession? A key lesson is that both accession candidate countries and existing EU members can benefit if they put in the work. This is no easy task. It would require strong pre-accession reforms, significant financing, political resolve, and possible institutional adaptation.
Some factors of the 2004 successes may be harder to achieve today. For accession countries this puts a premium on those actions directly under their control, such as the reform effort to close business regulation and institutional gaps to the EU. From the existing members’ side, continuing to deepen the single market by removing remaining within-union trade barriers and advancing the capital market union to finance dynamic firms’ growth would further amplify the potential gains. These joint efforts could not only accelerate catch-up within Europe, but also help narrow Europe’s persistently large income gap with the US.
 
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The latest Eurobarometer released today reveals the highest level of trust in the European Union since 2007 and the highest-ever support for the euro. The survey also shows that Europeans have a more optimistic view about the future. They would like to see a stronger and more independent EU, especially in the face of the current global challenges.
Trust in the EU is at its highest level in 17 years
51% of Europeans tend to trust the EU, the highest result since 2007. Trust in the EU is highest among the young people aged 15-24 (59%). In another 17 year-record, 51% of Europeans said they trust the European Commission.
Almost three quarters of respondents (74%) say they feel citizens of the EU, the highest level in more than two decades. In addition, more than six in ten EU citizens (61%) are also optimistic about the future of the EU.
At the same time, 44% of EU citizens continue to have a positive image of the EU, while 38% have a neutral image and 17% have a negative image of the EU.
Positive trends also registered in most of the enlargement countries surveyed. The majority of citizens tend to trust the EU*, in Albania (81%), Montenegro (75%), Kosovo (70%), Georgia (58%), North Macedonia and Bosnia and Herzegovina (56% each), and Moldova (52%). In Türkiye 42% (four percentage points more compared to the previous survey) tend to trust the EU and in Serbia 38% (+2 percentage points). 38% of United Kingdom respondents (+6 percentage points) also share this view.
Europeans want a stronger, more independent and sustainable EU
Nearly seven in ten respondents (69%) agree that the EU has sufficient power and tools to defend the economic interests of Europe in the global economy. Similarly, 69% agree that the European Union is a place of stability in a troubled world.
According to Europeans, security and defence (33%) should be the main priority area for the EU action in the medium term, followed by migration (29%), the economy (28%), climate and the environment (28%), and health (27%). At the same time, 44% of European citizens think that ensuring peace and stability will have the highest positive impact on their life in the short term, followed by securing food, health, and industry supplies in the EU and managing migration (both 27%). When it comes to specific areas for EU action in the clean sector, Europeans believe the EU should prioritise renewable energy (38%) first, followed by investments in sustainable agriculture (31%), energy infrastructure (28%) and clean technology investments (28%).
Historic high support for the euro and growing optimism about the economy
The Eurobarometer survey registered the highest support ever for the common currency, both in the EU as a whole (74%) and in the euro area (81%). When it comes to the perception of the situation of the European economy, 48% of Europeans (up one point since spring 2024) find it good while 43% (up two points) find it bad. The perception of the situation of the European economy has steadily improved since autumn 2019. A plurality of citizens (49%) think the European economic situation will remain stable in the next 12 months.
Continued support for EU’s response to the war in Ukraine
In the face of the Russian war of aggression against Ukraine, nearly nine Europeans in ten (87%) agree with providing humanitarian support to the people affected by the war. 71% of EU citizens support economic sanctions on the Russian government, companies, and individuals and 68% agree with providing financial support to Ukraine. Six in ten approve of the EU granting candidate status to Ukraine and 58% agree with the EU financing the purchase and supply of military equipment to Ukraine.
The war in Ukraine continues to be considered as the most important issue at EU level (31%) out of 15 items (followed by immigration at 28% and the international situation at 22%), while 76% of European respondents agree that Russia’s invasion of Ukraine is a threat to the security of the EU.
Background
The Standard Eurobarometer 102 (Autumn 2024) was conducted between 10 October and 5 November 2024 across the 27 Member States. Overall, 26,525 EU citizens were interviewed face-to-face. Interviews were also conducted in nine candidate and potential candidate countries (all except Ukraine) and the United Kingdom.
 
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The Council of the EU has endorsed 46 Global Gateway flagship projects for 2025.
The projects identified as flagships by EU member states’ ambassadors are prominent examples of Global Gateway deliverables in the areas of digital, climate and energy, transport, health, education and research.
This selection of key initiatives helps to showcase the comprehensive support the EU and its member states offer to partners across the globe in terms of the sectors of activities, as well as the countries and regions concerned. The flagship projects contribute to strengthening our strategic partnerships and the promotion of our joint interests. Each project is scheduled to achieve a tangible deliverable and milestone during 2025.
Flagship projects are identified on a yearly basis and integrated in a Global Gateway flagships list which includes 218 initiatives from previous years, in this case 2023 and 2024. The flagship list is not exhaustive in relation to all projects and activities under Global Gateway, but aims to serve as a tool for the EU and its member states for strategic communication and visibility during the year 2025 in the EU’s engagement with its partners. Flagship projects showcase concrete transformative projects and emphasise their tangible impact and benefits to local communities. The inclusion of projects from member states in the list does not guarantee EU financing for those projects.

The selection is carried out in line with the Global Gateway governance and taking into account the input from the Commission, the EEAS and the member states. Once a project is included in the list, it remains a flagship project until its completion. To support the continued accuracy and relevance of the list, a review procedure has been introduced to allow for streamlining projects identified as flagships in 2023 and 2024.
Background
The EU’s Global Gateway strategy encourages public and private investment in infrastructure, green energy, education and research for sustainable development and aims to mobilise up to €300 billion of investments worldwide between 2021 and 2027. Through the Global Gateway, the EU and its member states develop and invest in sustainable and quality investment projects around the world, in close cooperation with EU’s partners around the world.

 
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ECB updates digital euro rulebook following joint review with consumers, retailers and payment service providers
ECB concludes call for applications to select potential external providers and publishes invitation to tender
ECB launches new research to incorporate users’ digital euro design preferences
Stakeholder engagement across euro area remains key priority to support ongoing legislative deliberations

The European Central Bank (ECB) has published its second progress report on the preparation phase of a digital euro, which was launched on 1 November 2023 and is laying the foundations for the potential issuance of a digital euro.
Since the publication of the first progress report, the ECB has updated its digital euro scheme rulebook, aimed at harmonising digital euro payments across the euro area. This followed an interim review carried out by members of the Rulebook Development Group, representing the views of consumers, retailers and payment service providers. The updated draft also includes input from seven new workstreams, launched in May 2024 to further develop key sections of the rulebook, including minimum user experience standards and risk management.
In parallel, the ECB has concluded a call for applications, launched in January, for selecting potential providers of digital euro components and related services. The ECB has invited selected bidders to tender. The outcome of this procedure will be published on the ECB’s website when it has been finalised in 2025.
At the same time, new user research and experimentation activities are now underway to gather insights into users’ preferences and to inform decision-making for a possible digital euro. Both quantitative and qualitative engagements are foreseen in the coming months, including online surveys and interviews. These will focus on special target groups, such as small merchants and vulnerable consumers. The findings will be published in mid-2025.
Following a call launched in November, the ECB will join with key stakeholders, including merchants, payment service providers, fintech companies and universities, to form innovation partnerships to test conditional payments (i.e. payments that are made automatically when predefined conditions are met) and explore other innovative use cases for a digital euro. An outcome report is expected to be published in July 2025.
In parallel, the ECB is working with experts from the national central banks of the Eurosystem and national competent authorities to develop a methodology for setting digital euro holding limits, balancing user experience with monetary policy and financial stability implications. This work will allow the ECB to determine the factors to be considered in the calibration, and to propose a methodology to calibrate the digital euro holding limits. It includes consultation with market participants through the European Retail Payments Board and also relies on granular bank data specifically collected for this purpose. The proposed method will be tested in a first analysis in the course of 2025.
The digital euro project is a European initiative being developed for the benefit of millions of citizens across the euro area. Engagement with external stakeholders, ranging from policymakers and market participants to the general public, is a key priority. The ECB is committed to continue working closely with all stakeholders involved and to regularly communicate project developments to the wider public, engaging with all euro area citizens.
The ECB’s Governing Council will decide on the possible issuance of a digital euro only once the relevant legislation has been adopted.
 
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Generative Artificial Intelligence (AI) will impact regional local job markets differently across OECD countries, exacerbating existing urban-rural income and productivity gaps as well as the digital divides between regions, according to a new OECD report.
Job Creation and Local Economic Development 2024 finds that, following a decade of employment growth, over half of OECD regions had reached employment rates above 70% by 2023, with more women joining the workforce, narrowing the gender gap in labour force participation in 84% of OECD regions.
The employment boom has also led to regional labour shortages and gaps, particularly in densely populated urban regions such as Lombardy (Italy) and Hamburg (Germany), as well as in regions struggling with population decline and ageing.
Against this backdrop, Generative AI has the potential to help tackle labour shortages and boost productivity. However, the report highlights significant regional disparities in the extent to which jobs are affected by Generative AI, with the share of workers with jobs exposed to AI ranging from 45% in urban regions such as Stockholm (Sweden) and Prague (Czechia), to 13% in rural regions such as Cauca (Colombia).
Urban workers are more likely to be affected, with an average of 32% already exposed to Generative AI, compared to just 21% of rural workers. This trend could risk worsening existing urban-rural income and productivity gaps, as well as digital divides between regions.
Regions previously considered to be at comparatively low risk of automation are now among the most exposed to Generative AI, according to the report. While technology-led automation has historically affected non-metropolitan and manufacturing regions, now metropolitan areas, high-skilled workers and women face greater exposure as Generative AI excels in performing cognitive and non-routine tasks.
“The rapid adoption of Generative AI is reshaping local job markets, offering solutions to labour shortages and boosting productivity,” OECD Secretary-General Mathias Cormann said. “But it also risks widening the digital divide between urban and rural areas. To harness its potential for all, policymakers must prioritise digital infrastructure, boost digital literacy, and support SMEs to ensure AI’s benefits reach everyone and help tackle local skills bottlenecks.”

The full report Job Creation and Local Economic Development 2024: The Geography of Generative AI along with detailed findings, country notes and graphs is available here.
More information about the OECD’s work on local employment and economic development can be found here.
Journalists can request advance access to the electronic version of the report under embargo, one day before its release. To request the report, please email embargo@oecd.org, ensuring compliance with OECD’s embargo procedures.
For further information or to arrange interviews, journalists should contact Kim Chardon in the OECD Media Office (+33 1 45 24 97 00).

 
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Project in Georgia, California, and Arizona aim to strengthen America’s leadership in cutting-edge substrate technology for critical industries like AI
Today, the Biden-Harris Administration announced that the U.S. Department of Commerce (DOC) is entering negotiations to invest up to $300 million in advanced packaging research projects in Georgia, California, and Arizona to accelerate the development of cutting-edge technologies essential to the semiconductor industry. The expected recipients are Absolics Inc. in Georgia, Applied Materials Inc. in California, and Arizona State University in Arizona.
These competitively awarded research investments, each expected to total as much as $100 million, represent novel efforts in advanced substrates. Advanced substrates are physical platforms that allow multiple semiconductor chips to be assembled seamlessly together, enable high-bandwidth communication between those chips, efficiently deliver power, and dissipate unwanted heat. The advanced packaging enabled by advanced substrates translates to high performance computing for AI, next-generation wireless communication, and more efficient power electronics. Such substrates are not currently produced in the United States but are foundational to establishing and expanding domestic advanced packaging capability. Up to $300 million in federal funding will be paired with additional investments from the private sector, bringing the expected total investment across all three projects to over $470 million. This combined effort will help ensure U.S. manufacturers stay competitive and continue to drive technological innovation, giving companies a stronger edge in global competition.
“The key to the United States’ long-term competitiveness hinges on our ability to out-innovate and out-build the rest of the world. That’s why the R&D side of the CHIPS for America Program is so fundamental to our success, and these proposed investments in advanced packaging underscore the work we’re doing to prioritize every step of the semiconductor supply chain pipeline,” said U.S. Secretary of Commerce Gina Raimondo. “Emerging technology like AI requires cutting-edge advances in microelectronics, including advanced packaging. Thanks to President Biden’s and Vice President Harris’ leadership, and through these proposed investments, we are positioning the United States as a global leader in designing, manufacturing and packaging the microelectronics that will fuel tomorrow’s innovation.”
“Today’s awards are vital to secure America’s global leadership in semiconductors– making sure the supply chain here in America is on the cutting edge from end to end,” said National Economic Advisor Lael Brainard.
Rising power consumption, computational performance in AI data centers, and scalability in mobile electronics will not be solved with current packaging technology. Sustaining these industries of the future in America will require innovation at all levels. The CHIPS National Advanced Packaging Manufacturing Program (NAPMP) set aggressive technical targets for the substrates that all three entities are expected to meet or exceed. Advanced substrates are the basis for advanced packaging, which will enhance key advanced packaging technologies including but not limited to equipment, tools, processes, and process integration. The projects will play a vital role in helping to ensure that American innovation drives cutting-edge developments in semiconductor research and development (R&D) and manufacturing.
“Advanced packaging is essential to the development of the advanced semiconductors that are the drivers of emerging technology like artificial intelligence,” said Under Secretary of Commerce for Standards and Technology and National Institute of Standards and Technology Director Laurie E. Locascio. “These first investments of the National Advanced Packaging Manufacturing Program will drive breakthroughs that address a critical need in the CHIPS for America’s mission to create a robust domestic packaging industry where advanced node chips manufactured in the U.S. and abroad can be packaged within the United States.”
The proposed projects are:

Absolics, Inc. in Covington, Georgia: Absolics is poised to revolutionize glass core substrate panel manufacturing by developing cutting-edge capabilities in partnership with over 30 partners including academic institutions, large and small businesses, and non-profit entities, having been recognized as the recipient in the glass materials and substrates areas, with up to $100 million in potential funding. Through its Substrate and Materials Advanced Research and Technology (SMART) Packaging Program, Absolics aims to build a glass-core packaging ecosystem. In addition to developing the SMART Packaging Program, Absolics and their partners, is planning to support education and workforce development efforts by bringing training, internship, and certification opportunities into technical colleges, the HBCU CHIPS Network, and Veterans programs. Through these efforts, Absolics would leapfrog the current glass core substrate panel technology and support investments in a future high-volume manufacturing capability.

Applied Materials in Santa Clara, California: Applied Materials, along with a team of 10 collaborators, is working on developing and scaling a disruptive silicon-core substrate technology for next-generation advanced packaging and 3D heterogeneous integration. Applied’s silicon-core substrate technology has the potential to advance America’s leadership in advanced packaging and help catalyze an ecosystem to develop and build next-generation energy-efficient artificial intelligence (AI) and high-performance computing (HPC) systems in the US. In addition, Applied Materials’ education and workforce development plan is designed to strengthen the training and internship pipeline in the US between state universities and the semiconductor industry.

Arizona State University in Tempe, Arizona: Arizona State University is leading the charge in developing the next generation of microelectronics packaging through fan-out-wafer-level-processing (FOWLP). At the heart of this initiative is the ASU Advanced Electronics and Photonics Core Facility, where researchers are exploring the commercial viability of 300 mm wafer-level and 600 mm panel-level manufacturing, a technology that does not exist in as a commercial capability in the U.S. today. ASU’s team of over 10 partners, led by industry pioneer Deca Technologies, is centered in a regional stronghold for microelectronics manufacturing and is composed of large and small businesses, universities and technical colleges, and non-profits. This team spans the entire United States with industrial leaders in materials, equipment, chiplet design, electronic design automation, and manufacturing. ASU will establish an interconnect foundry that connects advanced packaging and workforce development programs with semiconductor fabs and manufacturers. ASU’s education and workforce development efforts bring industry-relevant training such as train the trainer, microcredentials, and quick start programs for working professionals. Inclusion of the HBCU CHIPS network and the National Center for American Indian Enterprise Development is integral to their workforce development plan.

About CHIPS for America
CHIPS for America is part of President Biden’s economic plan to invest in America, stimulate private sector investment, create good-paying jobs, make more in the United States, and revitalize communities left behind. CHIPS for America includes the CHIPS Program Office, responsible for manufacturing incentives, and the CHIPS Research and Development (R&D) Office, responsible for R&D programs. Both offices sit within the National Institute of Standards and Technology (NIST) at the Department of Commerce. NIST promotes U.S. innovation and industrial competitiveness by advancing measurement science, standards, and technology in ways that enhance economic security and improve our quality of life. NIST is uniquely positioned to successfully administer the CHIPS for America program because of the bureau’s strong relationships with U.S. industries, its deep understanding of the semiconductor ecosystem, and its reputation as fair and trusted. Visit https://www.chips.gov to learn more.
About CHIPS National Advanced Packaging Manufacturing Program (NAPMP)
To enable the CHIPS Research and Development Office’s vision for success, the CHIPS National Advanced Packaging Manufacturing Program will make approximately $3 billion in investments to develop critical and relevant innovations for advanced packaging technologies and accelerate their scaled transition to U.S. manufacturing entities. These investments will include research programs for core technologies that can be scaled to high-volume manufacturing, an advanced packaging piloting facility to support this scaling, resources to support the expansion of advanced packaging solutions, and workforce development. As a result, within a decade, NAPMP-funded activities, coupled with CHIPS manufacturing incentives, will establish a vibrant, self-sustaining, high-volume, domestic, advanced packaging industry where advanced-node chips manufactured in the United States are packaged in the United States. The technology developed will be leveraged in new applications and market sectors and at scale.
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Improving fiscal policy frameworks, fostering education and skills, and supporting the green transition can help ensure strong, sustainable, balanced, and inclusive growth

Blog post by Paula Beltran Saavedra, Nicolas Fernandez-Arias, Chanpheng Fizzarotti, Alberto Musso | For most Group of Twenty economies, growth is poised to weaken over the next five years and remain well below what was typical in the two decades before the pandemic.

That’s one of the biggest shared challenges for the group, which accounts for about 85 percent of global gross domestic product. Growth is more robust across the African Union, which joined the G20 last year, but booming populations mean those economies also must create jobs for millions of young people entering the labor market.
For both groups, as well as the European Union, lifting growth is essential to improving outcomes for people, and there’s a common solution: implementing priority reforms can significantly boost prospects for growth over the next five years, or medium term, as our new report to the G20 outlines. Our analysis also indicates that payoffs from structural reforms are greatest when they are carefully sequenced and reflect social consensus.
Various challenges underscore why it’s time to invest in growth-enhancing reforms. Subdued productivity growth, reinforced in some countries by adverse demographic trends, holds back potential growth, as Chapter 3 of the April 2024 World Economic Outlook details. Sustainable growth also is imperiled by elevated public debt, and increased geoeconomic fragmentation and protectionism.
As the Chart of the Week shows, the biggest priority across countries in these groups is reforming fiscal policy frameworks to aid lasting consolidation of government budgets.

Specifically, most G20 advanced economies and several EU economies would benefit from tighter public spending limits, while for most G20 emerging market and developing economies reforms to boost government revenues should be prioritized. Several African Union countries could benefit from enhanced fiscal transparency.
For many G20 and African Union economies, there are two other key areas for high priority structural reforms. First, the quality of education and skill training must be improved to better match skills with job opportunities. Second, reforms to accelerate the energy transition are essential, such as improving renewable energy capacity, enhancing the carbon tax efficacy, and phasing out fossil fuel subsidies. In several African Union economies, governance reforms are also urgently needed to strengthen the rule of law, fight corruption and improve public finance management.

 
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The average level of tax revenues among OECD countries was largely unchanged in 2023 as governments sought to ease cost-of-living pressures amid growing spending challenges related to climate change and ageing populations, according to a new report released today.
Revenue Statistics 2024 shows that the average tax-to-GDP ratio for OECD countries was 33.9% in 2023, 0.1 percentage points (p.p.) below its level in 2021 and 2022, but above its pre-pandemic level of 33.4% in 2019.
In 2023, the tax-to-GDP ratio increased in 18 of the 36 OECD countries for which preliminary data are available, declined in 17, and remained unchanged in one. The largest increases (of at least 2.5 p.p.) occurred in Luxembourg, Colombia and Türkiye, while the largest declines (of at least 3.0 p.p.) were observed in Israel, Korea and Chile.
Across the OECD, tax-to-GDP ratios ranged from 17.7% in Mexico to 43.8% in France in 2023. The difference between the highest and the lowest tax-to-GDP ratio across OECD countries was 26.1 p.p. in 2023, the smallest difference since at least 2000. Since 2019, this difference has narrowed by 5.2 p.p.

Revenue Statistics 2024 includes a special chapter on health taxes, which are increasingly common in OECD countries due to their capacity to generate revenues and to improve health outcomes by reducing consumption of harmful products. On average across OECD countries, revenues from excise taxes on alcohol, tobacco and sugar-sweetened beverages amounted to 0.7% of GDP and generated 2.2% of total tax revenues in 2022. However, these revenues declined as a proportion of GDP between 2000 and 2022 in almost all OECD countries, with the largest drop seen in revenues from excise taxes on alcohol.
Consumption Tax Trends 2024, also released today, highlights governments’ ongoing efforts to improve the performance of their VAT systems and combat fraud and non-compliance. The report shows that VAT revenues continue to rise across the OECD, reaching 20.8% of total tax revenue on average in 2022, up 0.1 p.p. from 2021.
According to the new report, which presents cross-country detailed comparative data on consumption tax rates, tax bases and design trends, most OECD countries have implemented reforms to ensure that VAT is effectively collected on online sales, in line with OECD standards, ensuring a level playing field between bricks-and-mortar businesses and online merchants.
Twenty-seven OECD countries have introduced solutions developed by the OECD to collect VAT on e-commerce sales of goods imported from abroad. These complement measures to collect VAT on online services – such as apps and streaming services – that have now been adopted by almost all OECD countries that have a VAT.
Consumption Tax Trends 2024 explains that almost all OECD countries with a VAT have now implemented digital reporting requirements, often requiring the electronic transmission of detailed transactional information in real time or periodically, to enhance VAT compliance. However, the scope and requirements of these regimes vary across OECD countries.
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Projects in Georgia, California, and Arizona aim to strengthen America’s leadership in cutting-edge substrate technology for critical industries like AI
Today, the Biden-Harris Administration announced that the U.S. Department of Commerce (DOC) is entering negotiations to invest up to $300 million in advanced packaging research projects in Georgia, California, and Arizona to accelerate the development of cutting-edge technologies essential to the semiconductor industry. The expected recipients are Absolics Inc. in Georgia, Applied Materials Inc. in California, and Arizona State University in Arizona.
These competitively awarded research investments, each expected to total as much as $100 million, represent novel efforts in advanced substrates. Advanced substrates are physical platforms that allow multiple semiconductor chips to be assembled seamlessly together, enable high-bandwidth communication between those chips, efficiently deliver power, and dissipate unwanted heat. The advanced packaging enabled by advanced substrates translates to high performance computing for AI, next-generation wireless communication, and more efficient power electronics. Such substrates are not currently produced in the United States but are foundational to establishing and expanding domestic advanced packaging capability. Up to $300 million in federal funding will be paired with additional investments from the private sector, bringing the expected total investment across all three projects to over $470 million. This combined effort will help ensure U.S. manufacturers stay competitive and continue to drive technological innovation, giving companies a stronger edge in global competition.
“The key to the United States’ long-term competitiveness hinges on our ability to out-innovate and out-build the rest of the world. That’s why the R&D side of the CHIPS for America Program is so fundamental to our success, and these proposed investments in advanced packaging underscore the work we’re doing to prioritize every step of the semiconductor supply chain pipeline,” said U.S. Secretary of Commerce Gina Raimondo. “Emerging technology like AI requires cutting-edge advances in microelectronics, including advanced packaging. Thanks to President Biden’s and Vice President Harris’ leadership, and through these proposed investments, we are positioning the United States as a global leader in designing, manufacturing and packaging the microelectronics that will fuel tomorrow’s innovation.”
“Today’s awards are vital to secure America’s global leadership in semiconductors– making sure the supply chain here in America is on the cutting edge from end to end,” said National Economic Advisor Lael Brainard.
Rising power consumption, computational performance in AI data centers, and scalability in mobile electronics will not be solved with current packaging technology. Sustaining these industries of the future in America will require innovation at all levels. The CHIPS National Advanced Packaging Manufacturing Program (NAPMP) set aggressive technical targets for the substrates that all three entities are expected to meet or exceed. Advanced substrates are the basis for advanced packaging, which will enhance key advanced packaging technologies including but not limited to equipment, tools, processes, and process integration. The projects will play a vital role in helping to ensure that American innovation drives cutting-edge developments in semiconductor research and development (R&D) and manufacturing.
“Advanced packaging is essential to the development of the advanced semiconductors that are the drivers of emerging technology like artificial intelligence,” said Under Secretary of Commerce for Standards and Technology and National Institute of Standards and Technology Director Laurie E. Locascio. “These first investments of the National Advanced Packaging Manufacturing Program will drive breakthroughs that address a critical need in the CHIPS for America’s mission to create a robust domestic packaging industry where advanced node chips manufactured in the U.S. and abroad can be packaged within the United States.”
The proposed projects are:

Absolics, Inc. in Covington, Georgia:  Absolics is poised to revolutionize glass core substrate panel manufacturing by developing cutting-edge capabilities in partnership with over 30 partners including academic institutions, large and small businesses, and non-profit entities, having been recognized as the recipient in the glass materials and substrates areas, with up to $100 million in potential funding. Through its Substrate and Materials Advanced Research and Technology (SMART) Packaging Program, Absolics aims to build a glass-core packaging ecosystem. In addition to developing the SMART Packaging Program, Absolics and their partners, is planning to support education and workforce development efforts by bringing training, internship, and certification opportunities into technical colleges, the HBCU CHIPS Network, and Veterans programs. Through these efforts, Absolics would leapfrog the current glass core substrate panel technology and support investments in a future high-volume manufacturing capability.

Applied Materials in Santa Clara, California: Applied Materials, along with a team of 10 collaborators, is working on developing and scaling a disruptive silicon-core substrate technology for next-generation advanced packaging and 3D heterogeneous integration. Applied’s silicon-core substrate technology has the potential to advance America’s leadership in advanced packaging and help catalyze an ecosystem to develop and build next-generation energy-efficient artificial intelligence (AI) and high-performance computing (HPC) systems in the US. In addition, Applied Materials’ education and workforce development plan is designed to strengthen the training and internship pipeline in the US between state universities and the semiconductor industry.

Arizona State University in Tempe, Arizona: Arizona State University is leading the charge in developing the next generation of microelectronics packaging through fan-out-wafer-level-processing (FOWLP). At the heart of this initiative is the ASU Advanced Electronics and Photonics Core Facility, where researchers are exploring the commercial viability of 300 mm wafer-level and 600 mm panel-level manufacturing, a technology that does not exist in as a commercial capability in the U.S. today.  ASU’s team of over 10 partners, led by industry pioneer Deca Technologies, is centered in a regional stronghold for microelectronics manufacturing and is composed of large and small businesses, universities and technical colleges, and non-profits. This team spans the entire United States with industrial leaders in materials, equipment, chiplet design, electronic design automation, and manufacturing. ASU will establish an interconnect foundry that connects advanced packaging and workforce development programs with semiconductor fabs and manufacturers. ASU’s education and workforce development efforts bring industry-relevant training such as train the trainer, microcredentials, and quick start programs for working professionals. Inclusion of the HBCU CHIPS network and the National Center for American Indian Enterprise Development is integral to their workforce development plan.

About CHIPS for America    
CHIPS for America is part of President Biden’s economic plan to invest in America, stimulate private sector investment, create good-paying jobs, make more in the United States, and revitalize communities left behind. CHIPS for America includes the CHIPS Program Office, responsible for manufacturing incentives, and the CHIPS Research and Development (R&D) Office, responsible for R&D programs. Both offices sit within the National Institute of Standards and Technology (NIST) at the Department of Commerce. NIST promotes U.S. innovation and industrial competitiveness by advancing measurement science, standards, and technology in ways that enhance economic security and improve our quality of life. NIST is uniquely positioned to successfully administer the CHIPS for America program because of the bureau’s strong relationships with U.S. industries, its deep understanding of the semiconductor ecosystem, and its reputation as fair and trusted. Visit https://www.chips.gov to learn more.
About CHIPS National Advanced Packaging Manufacturing Program (NAPMP)
To enable the CHIPS Research and Development Office’s vision for success, the CHIPS National Advanced Packaging Manufacturing Program will make approximately $3 billion in investments to develop critical and relevant innovations for advanced packaging technologies and accelerate their scaled transition to U.S. manufacturing entities. These investments will include research programs for core technologies that can be scaled to high-volume manufacturing, an advanced packaging piloting facility to support this scaling, resources to support the expansion of advanced packaging solutions, and workforce development. As a result, within a decade, NAPMP-funded activities, coupled with CHIPS manufacturing incentives, will establish a vibrant, self-sustaining, high-volume, domestic, advanced packaging industry where advanced-node chips manufactured in the United States are packaged in the United States. The technology developed will be leveraged in new applications and market sectors and at scale.
 
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